NEW YORK: The technology-heavy Nasdaq led Wall Street lower on Thursday as a rotation out of richly valued stocks into underpriced sectors added to pressure from quarter-end rebalancing by institutional investors.

The main US stock indexes also shrugged off the Labour Department’s jobless claims report - the most timely indicator of economic health - that showed fewer-than-expected Americans filed new claims for state unemployment benefits last week.

Seven of the 11 S&P sectors fell, led by the communication services and technology indexes, which house some of the best-performing stocks of 2020 including Apple Inc, Microsoft Corp and Netflix Inc.

Heavyweight technology stocks Facebook Inc, Google parent Alphabet Inc and Twitter Inc slipped about 1% ahead of their chief executives’ testimony before Congress about extremism and misinformation on their services.

By 12:13 p.m. ET, the Dow Jones Industrial Average was down 0.18%, the S&P 500 was down 0.24% and the Nasdaq Composite was down 0.51%.

The CBOE volatility index was up for a third straight day after briefly falling to its pre-pandemic lows earlier this week.